As Colorado prepares for a May 1 launch of legalized sports betting, the nascent market is being compared favorably to a similar model adopted by New Jersey shortly after the repeal of PASPA two years ago.
Within months in 2018, more than a dozen sportsbooks opened shop in the Garden State in an effort to capitalize on the long popular, newly legal form of gambling. By comparison, the Colorado Limited Gaming Control Commission (LGCC) has plans to award as many as 33 licenses to operate retail and online sportsbooks throughout the Centennial State.
As of Feb. 27, the Colorado Department of Revenue’s Division of Gaming received 60 license applications since the passage of Proposition DD in November, a division spokesperson told COBets. How you run and finish a race matters, but first you have to get a spot in the starting gate.
Big sports city in Denver, big opportunity
The LGCC has designated three classifications for approval, as it conducts a comprehensive sports betting licensure process. Before existing casino properties can begin accepting sports bets, the casinos must have their “master sports betting license” applications approved by the state. The division is also reviewing sports betting “operator licenses” for brick-and-mortar partners and “internet sports betting licenses” for online/mobile betting purposes.
The division has received applications for 32 master licenses, 10 operator licenses and 18 internet licenses as of Feb. 27, the spokesperson confirmed.
With franchises in all four major U.S. professional sports, as well as the MLS, Denver is positioning itself to become one of the largest sports cities in the U.S. so far to have unfettered access to legal online sportsbooks, once it becomes operational. It is no wonder that most of the top sportsbook operators nationwide are pushing hard to enter the Colorado market in time for the May launch.
The commission issued master licenses for seven casinos at a meeting Feb. 20. A handful of others could receive approval at its next meeting on March 19. The commission is scheduled to meet twice more before the projected May launch. Among the casinos that received approval include Double Eagle Hotel & Casino in Cripple Creek and Saratoga Casino in Black Hawk. The casino properties have already inked agreements with PointsBet USA and Betfred USA Sports, respectively.
The commission also approved master license applications for five others:
- Monarch Casino Resort Spa in Black Hawk
- Dostal Alley in Central City
- Brass Ass Casino in Cripple Creek
- J.P. McGill’s Hotel & Casino in Cripple Creek
- Midnight Rose Hotel & Casino in Cripple Creek
Of the major sportsbooks targeting the Colorado market, arguably none have made as many inroads throughout the state as PointsBet, an Australian bookmaker. Last October, PointsBet opened its second U.S.-based headquarters in Downtown Denver, a hub that serves as the company’s western operations base.
“We want to be synonymous with Colorado,” said Ron Shell, vice president of customer & insights at PointsBet US. To that end, PointsBet has plans to offer attractive pricing options and a wide range of boosted bet promotions in Colorado upon its launch.
During an interview with COBets, Shell indicated that PointsBet has engaged in discussions with several Denver-area sports franchises on a potential partnership. A spokesperson for the Denver Nuggets declined to comment on the team’s interest in reaching a deal with a sportsbook operator.
Former Sixers and Nuggets guard Allen Iverson has endorsed PointsBet since 2018.
PointsBet is expected to be joined in the Colorado marketplace by a bevy of heavy hitters. The list includes: DraftKings, FanDuel, William Hill US, and Derek Stevens’ Circa Sports, set to make its first foray outside Las Vegas so far among others. Whether Colorado becomes as vibrant as the New Jersey or spirals into the Wild West of Sports Betting remains to be seen.
Starting May 1, gamblers can bet on sports at licensed Colorado casinos and via web-based or mobile apps, but how does it work? https://t.co/QSvLfASOgD
— The Denver Post (@denverpost) February 26, 2020
Ahead of the commission’s next meeting, COBets is handicapping the casinos next in line for license approval.
In many respects, it is a bit of surprise that a trio of casinos owned by Twin River World Holdings Inc. were not among the first round of properties licensed by the commission. Last month, DraftKings and FanDuel took steps to enter Colorado under a market access agreement with Twin River. Twin River, a Rhode Island-based gaming company, received three skins upon its acquisition of The Golden Gates Casino, Golden Gulch Casino and Mardi Gras Casino, all located in Black Hawk.
At the time, Twin River CEO George Papanier gushed that the partnerships with the DFS giants will allow the company to provide an “unmatched sports betting experience to Colorado,” both from a mobile and retail perspective. Under the deal, DraftKings will operate a retail sportsbook at Mardi Gras, a Black Hawk venue that is home to the annual Colorado Poker Championship.
The properties will benefit from considerable lobbying heft on behalf of their sportsbook partners. Ahead of the election, the companies spent more than $1.5 million on lobbying and advertising costs, the Associated Press reported. After releasing its FY 2019 earnings this week, Flutter Entertainment pointed to its first skin market access agreement in Colorado as a model to adopt in other states.
Flutter is the parent company of FanDuel Group.
Odds: Even money to 6/5
Keep an eye on two other properties in Black Hawk, the Isle Casino & Hotel and the Lady Luck Casino, both of which are owned by Eldorado Resorts. Eldorado is nearing the completion of its proposed $17.3 billion acquisition of Caesars Entertainment, one Eldorado Resorts CEO Tom Reeg noted this week is nearing the finish line. Eldorado also completed a deal with William Hill last January which gave the casino operator a 20% stake in William Hill US.
As a result, William Hill is poised to break ground at the two Colorado casinos. William Hill may break out a similar playbook that it employed in Iowa last July when the company announced partnerships with two Eldorado casinos –Isle Casino Hotel Bettendorf and Isle Casino Hotel Waterloo. In total, William Hill now accepts legal sports bets in eight states nationwide.
Another interesting case surrounds Circa Sports, a company founded by Las Vegas entrepreneur Derek Stevens. Circa expanded outside Nevada earlier this month when it announced a partnership with Century Casinos Feb. 6. Circa will operate in Colorado through a master license held by Century Casino & Hotel Cripple Creek.
Stevens has moved aggressively to broaden his company’s presence throughout Downtown Las Vegas by opening retail sportsbooks at The D Las Vegas and the Golden Gate Hotel & Casino.
“Colorado has proven to be an ideal place to mark the official expansion of Circa Sports outside of Nevada with its pro-growth regulatory environment,” Stevens said.
Less than 25% of Colorado’s casinos were issued a master license by the commission at last week’s meeting. One notable omission was Ameristar Black Star, a casino and hotel operated by Penn National Gaming, which recently hitched its wagon to Barstool Sports, which later in 2020 will have its Barstool Sportsbook hit the market. At 57,000 square feet, the Ameristar Black Star is one of the largest in the state
Odds: 5/1 to 10/1
A number of smaller sportsbook operators have deals in place with casinos that have yet to be issued licenses. One property, Bronco Billy’s Casino in Cripple Creek, has skin agreements with three sportsbooks: Smarkets, Wynn Sports and the Churchill Downs Inc.-controlled BetAmerica.
The U.K. based Smarkets is best known for its political betting lines. Last week, Bernie Sanders’ probability to win the Democratic Party nomination spiked above 50% on a Smarkets betting exchange following his performance at a debate in Las Vegas.
Another operator, Toronto-based TheScore Inc., gained entry to the Colorado market for theScore Bet through a 10-year deal with Jacobs Entertainment in January. Jacobs Entertainment is the owner of The Lodge Casino in Black Hawk. Last September, theScore became the first mobile sportsbook to be created and launched by a North American media company, according to its website.
Odds: 15/1 and above
The majority of the seven casinos already licensed by the commission do not have partnerships in place with sportsbooks. In fact, only two of the aforementioned properties, Double Eagle and Saratoga Casino have completed deals with sportsbook operators.
Casinos in Central City may find it challenging to attract operators interested in capturing sizable retail sportsbook dollars. Several casinos in the historic mining settlement pale in size in comparison with their counterparts from Cripple Creek and Black Hawk. An operator of Dostal Alley in Central City expects to encounter a steep learning curve when it comes to sports betting, according to Westword.com.
Three prominent operators, FOX Bet, BetMGM and Bet365 have yet to enter the Colorado market, at least publicly.
A master license in Colorado costs $10,000 at the start of the application process, plus another $125,000 upon approval.
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